Sony Buys Gaikai - What It Means For Consoles

Feature

Sony buys streaming video game service Gaikai, so what does that mean for the future of home video game consoles?

Sony purchasing cloud video game streaming service Gaikai for $380M is perhaps the biggest announcement this year. If you haven’t read about it yet, you may want to check out the press release first. The deal marks the start of a groundbreaking effort to bring cloud-based gaming to homes globally and will change the future of gaming consoles in homes.

Cloud gaming (the streaming kind) has not made it to consoles and services such as OnLive and Gaikai have created their own eco-systems, usually focusing on PC gamers. Their technology enables games to be streamed from their own servers, straight into your home or even to your mobile device without needing to install anything more complex than a web browser or a light client before you are able to game. Hardware requirements are pretty much out of the window and compatibility problems are a thing of the past, as is piracy.

With the acquisition of Gaikai, Sony will be looking to break the console mold and bring streaming services perhaps not to the PlayStation 4 but to their next line of televisions. Sony is banking on cloud gaming so much with their next generation of video gaming that - in a time where their financials aren't exactly in the greatest shape - they spent the better part of half of a billion dollars on it.

Acquiring Gaikai gives Sony a way to bring free-to-play titles and demos to browser-based devices (phones, tablets, televisions, etc.) without the requirement of using a console or dedicated computer. The service runs using a browser without the use of dedicated hardware or software and is perfect for Sony to implement with their smartphones, tablets, and new line of televisions. It becomes a way for the company to reach a broader audience with their games, a marketing tool without peer in the gaming industry. Those consumers who buy the latest television technology but aren't necessarily gamers will have a way to play games without having to shell out more money for Sony's next PlayStation home video game console.

In my opinion, Sony doesn't view their purchase of Gaikai as a replacement for console gaming but rather as a supplement to it. Think about it, the next PlayStation console is going to be a game changer with the latest and greatest in hardware, graphics, and entertainment value. Sony is not about to replace that experience with strictly a cloud-based gaming adventure. Instead they'll probably use Gaikai to introduce consumers to their most popular PlayStation features and gaming properties. It's probably the best way to use an off-setting cloud gaming service to introduce consumers to your product. Console-less gaming is still years (YEARS!) away and Sony realizes this and are the first major gaming company to take strides towards that impending future. Sony also realizes that gaming can't be solely dependent on today's internet connection. Of course you've had bad internet connections before and a significant portion of the world's gaming population currently does not have reliable internet stability, which means cloud-based gaming can't yet survive on its own. Thus the need to introduce cloud-based gaming in a different, less threatening light. Give the consumer a way to play Flower or flOw or Journey without the need for a PlayStation 4 and you might have a customer for life.

So what does this deal mean for the other major video game companies, such as Microsoft and Nintendo? What kind of effect does the purchase of Gaikai have on OnLive and other cloud-gaming based services? It certainly means that gaming is evolving and will soon begin to transition away from disc-based gaming and more towards gaming in the cloud. It also means that the pressure is on Microsoft to make a significant announcement regarding their next video game console here in the near future. More so on Microsoft than on Nintendo mainly because the Wii U is well on its way to homes later this year. Microsoft should seriously explore the possibility of teaming up with Steam or OnLive to compete with Sony in the soon-to-be competitive cloud-gaming market. It's the only way to evolve and the sooner Microsoft and Nintendo realize this, the sooner devices underneath/beside/or on top of our televisions can cease to be.

To tell you the truth, I'd much rather buy a television with a gaming service built in to it rather than pay a significant amount of money for an add-on that gives me that same capability. It's still a ways off but it's good to see the future of gaming being birthed right before our eyes.
﻿